1-9-90 Community and Brand Building. Are Vitalik and Ethereum Foundation wrong?
This started as a twitter thread inspired by Vitalik vs DeFi debates, but turned into a communications guidebook I've been following since forever. Hope you find it useful!
This writeup is structured into 3 parts:
The importance of proper communication both with regular users and with partners. The preface uses a general example and sets the context for the topic.
The 1-9-90: the second part addresses the 1-9-90 guidebook and how I interpret it. It can be applied to bootstrapping any community in a broad sense.
The difficulty of having aligned communications in large groups, and the potential absence of need for it at later stages (Ethereum of today). You can see this third part as a sensationalist overview of the Ethereum debates of the last week, which are also part of the same issue. Does the 1-9-90 work for Ethereum? is one of the questions being addressed in that part.
1. Preface: The Usual Dev-VS-Holder Misunderstanding
Holder: “Wen exchange ser, wen listing?”
Dev: “We are focusing on the product ser, not now.”
Holder: “You don’t care about the community, screw you!”
Dev: “You are just a pump and dumper, go away!”
You’ve seen this before, right? This is what happens in every project chat on Discord, Telegram, and Twitter. I can promise you that both sides hate each other in this conversation. The holder is seen by the dev as a pleb asking for a quick pump and dump. Meanwhile, the dev is seen by the holder as an elitist jerk building air castles.
Both of these are right and wrong at the same time. They just can’t communicate. They speak different languages. The holder is simply concerned about the value of their bags, but do you think the dev isn’t? The dev is also concerned. Whether the dev is incapable of the business aspect - is another question, let’s keep it aside for now.
PS: note that I am not idolizing either one of the groups, because they are both right and wrong at the same time. Flocking to either side is a bad idea, you need to see the middle.
1.2 The immediate fix to prevent negativity from spreading
Holder: “Wen exchange ser, wen listing?”
Response: “Can’t respond to this publicly yet, but it’s an important question, of course. You can contribute to that discussion <here>. Meanwhile, we are working on some cool product releases, so give your opinion in this thread <there> want to present it!”
The said holder likely won’t engage further but they won’t stir shit up either. Their immediate need for a response was accommodated, and there is a chance they will go to <there> and contribute their opinion at the end of the day. Win-win!
Those with seasoned experience will understand that they are being given a pretty shallow reply, so you can’t make it too chatgpt. You need to funnel people into some relevant and useful context, then you don’t sound condescending like you are speaking to a child. Again, simply deflecting can work once or twice: it’s a delay until you have the real answer. Doing deflection recurringly will have a negative effect eventually. This strategy is also not going to work if the built-up anger has reached peak levels. In that case, you have to give real and long replies or accept the temporary downfall.
In WEB2 there are teams that deal with social media FUD prevention. In restaurants, there is trained staff who deal with even the most angry and drunk customers. Why do you think it’s different here?
No dev owes to a holder conceptually (I ethically think they do, but that’s another topic), however, nobody owes devs any recognition or money either.
Both of you, get down from your high horses.
1.3 The structural fix for the root cause
Their goal is somewhat the same: token go up. However, their paths to the goal are different, and thus their timelines are different too. The dev needs the project to be worth a lot to have enough liquidity to exit. Plus, some of the devs, believe it or not, want to build cool shit! The holder, on the other hand, would be happy with simply a $100K order book depth to sell into. Therefore, although their incentives are generally aligned, they work in different timeframes. This is obvious, I know.
Nevertheless, the best way both of their goals can only be achieved is if they work together. The dev needs a lot of holders, and a lot of holders need good devs to build. They can’t co-exist without one another, because if they try to… you end up with the markets of today. 90% engage in meme coin gambling PvP, and 1% are elitist phonies building air castles and spending their summers in Switzerland, right?!
PS: there are cases when devs give fake promises, or when holders go apeshit negative for any reason simply because the markets are all red. In those cases, you can’t do much on either side. You need to get together with your core supporters, align on the vision if you must refresh it, get your chins up, and work. If you get something good going and don’t die, you will get out stronger. Only brutal honesty works in cases of complete fallouts.
So, what the hell is 1-9-90, and how does it relate to all this? I didn’t come up with this concept myself, even Wikipedia has a page about it. I am not sure if my interpretation is actually what Wikipedia implies, but I have found it to work for years. Anywhere.
2. The 1-9-90 Community Building
To simplify it in the context of crypto, you can see it as:
1% are devs, builders, teams, and those who create.
9% are writers, funds, researchers, and angels who passionately observe the space and make some commentary. Not really teams, but not passing-by noobies either.
90% are random traders and speculators who actually don’t ever read docs. They read headlines, buy and trade coins, and hold crypto - but they are not bothering themselves with questions of research. Just yellow press enoyers and traders. They are not stupid, they just don’t bother to get married to any investment. Fundamentals for them don’t exist usually, they just want charts.
All of these groups are important. In isolation, they all slowly die.
Speculation fuels capital markets and investments, which in turn gives devs the resources to build, which then adds fundamentals to sheer speculation, and so on. It works as a living organism. Cut one part off, and it’s going to wither.
Don’t get cocky!
2.2 Why does the 1-9-90 work?
We can’t know everything and keep up with everything. We might not like overgeneralizing statistics and crafted feeds on Netflix, but we can’t live without them. Our minds would explode if we allowed multiple choices for every single thing we come across. Especially in startups. We want someone else to do the work for us. Those who go and dig through the piles of shit can find more refined gemstones, but it’s also simply okay to follow the herd sometimes.
Why even follow what any of the 9% say? - Those funds, researchers, and angels are seen as trustworthy in many cases. They have been around for years, so they won’t succumb to a lowlife cheap scam shilling. Or at least that’s the hope. As a result, it’s easier for traders and gamblers to simply pick assets that have the most reputable groups of supporters behind them.
Why does the 9% even bother to act as a filter? - Because the better they filter, the more money they make. And the better following they might attract for the long term. If you pick the gems sooner, you get better valuations and you also can signal to others that you have the skill to be a gemstone hunter.
The 9% is the gluing piece between the hardcore autistic 1% devs and the 90% of traders-holders who must receive a more refined narrative. If you were to specify what the 9% does, I’d say it’s organic marketing and a bit of warm intros BD. Essentially infusing the early unknown projects with reputation and sauce.
2.3 How do the 1-9-90 stages look like
All of the 3 usually never align at the same time, only in bull markets. The goal is to have 2/3 aligned at all times, and that’s doable. And by definition, it’s unlikely to have 1 and 90 be aligned because the gluing piece translating the news to the 90 are those 9. As a result, you must always start with 1+9, and then work from there.
An exception is having 1+90 because you are building something totally easy-to-use for the 90. That would be memecoins, tapping games on Telegram, and phenomena like that. In these cases, the bootstrapping doesn’t require the 9. However, that changes after these things go live and require some sustainable alignment, but that alignment is not needed for the bootstrap because everything happens on hype.
That would be your typical venture project with a team, angels, and then community holders. A team (1%) starts something, then (9%) propels it further and gives it visibility, and then the traders-holders (90%) pick up on the narratives and ride along.
The 1% devs start working on some idea and start making something.
They check with their friends, angels, capital allocators, researchers, etc. Those are the 9% who get excited by some of those ideas.
Then the ideas that due to some reason got picked up by many 1% and 9% participants, somehow find their way into the 90%.
This is the usual recipe and the direction of every single company. This doesn’t guarantee success, but this approach generally achieves the first steps. It’s generally easy to make anything go from 0 to 1 if you already have a network because whatever you shove down their throat as they will accept and stand behind.
A bad example would be Worldcoin, where a weird product and weird tactics with the token (despite how cutthroat and dystopian all they have is), a lot of “9s” backed it and accepted it into their communities simply due to the founders’ network.
2.4 The issue with not having the 9s
You often don’t want to be the exception to the rule and go the 1+90 route, because the 9s are more long-term oriented than the 90s. If you end up having only a hype-driven community without cultivating the 9s, during any market turmoil you might be left solely with 1s. That is the issue with hype-only projects. It’s a fine bootstrap strategy, but at the end of the day, you must find your 9s or turn your 90s members into the 9s. You can’t live without evangelizers and those who will stick around for you.
Remember the secondary market sales of “fair launches” in 2020-2021? Some projects launched without any sale, only with contributor and/or DAO portions. A few weeks or a few months in, they needed capital to sustain and build a brand/protocol further. Thus, they did secondary market OTC deals. Those were maybe at different prices, but they didn’t change the dynamics. End of the day, while they started with 1+90, they ended up having to find their 9s.
Another reason is related to people’s perceptions. If I am a researcher and I come into a chat, and the only things I see are giveaways and airdrops - I immediately think “this is a scam”. And I will be right most of the time. It’s a time-saving overgeneralizing approach, but it works. Therefore, you usually want to start lean and make technical content to grow that 1%+9% first, and then do the bigger reach tactics. Otherwise, you risk attracting 90%, getting too much noise, and failing to neither attract the external 9% nor convert any of your 90% into the 9s. Be careful!
This is especially dangerous for those tapping coins, and quick out-of-the-gate IEO launchpads. Luckily for those founders, the majority of the time those are made and set up like scams, so they don’t concern themselves with community building anyway.
Tech → Good angels → Hype
Yes, this can indeed turn into some sort of gatekeeping. But if there are no malicious intentions, it saves time for everyone and allows for genuine community building. Alternative approaches exist, so just check what your team's strengths are.
2.5 A real-life example: Ethereum conferences
The cleanest example of 1+9 interactions in the real world is Ethereum conferences. Many devs come there, they chat to funds and angels who look for alpha, and something is born as a result. The 9s, those who are funds and angels, could also love crazy dreams and ideas, but at the end of the day, they want to make money (more so than the 1s) so they need to fact-check with the 90s how much any given narrative is needed right now or could be needed later on.
It happens that 1+9s can force shit down the 90s’ throats, but it’s harder to do than anticipated. Artificially doing that is hard. You need some fundamentals and numbers to back up your claims: not always easy. You can see Celestia as an example of a well-crafted slightly-forced niche, valuation-wise. I don’t bash it at all, they are big brains, but pushing a new narrative into $10B+ and sustaining it for months is not easy. Nobody knew of DA among the 90s and they surely didn’t think it was a $10B+ market.
Anyway, the issue arises when the 9s get too high up on their supply too. That happens when they only spend time with the 1s and forget to fact-check their realities with the 90s. Then you end up with developer elitist closed-door orgies that benefit nobody. It’s important to keep an eye on reality, or everyone will suffer.
Permanent optimism and dreams are great, but overdoing them is not great.
2.6 How to maintain the 1-9-90 alignment beyond the bootstrap stage
Because nothing goes up permanently, you will have times when alignment and the belief in the future break, even if you had a perfect 1+9. In those times, you need to see the causes. Did the team stop working or did the markets simply go red? Are the devs working but they are building some air castles that even the 9% can’t understand?
Those are some of your questions to check for the sentiment. If the team is working and the narrative is intact, then likely 1+9 and is aligned. As a result, they need to build through the red markets, and then it’s okay. Nothing you can do here.
You should simply chat with your partners in times of a crisis, let them in on some new details, and re-confirm their bias if they need it. Nobody has complete trust in anything new from the start, but time creates strength in brands and the vision. Cultivate it first, and then it will happen by itself. This can actually also be applied to trading: when all coins were red during the bear market and MATIC was the only coin going up a bit, traders started memeing it into a “all-markets green safehaven”. Fr!
You can’t ever have the 9% and the 90% be confused. That means devs face complete alienation. You need the core team to speak to angels and researchers, and you need angels and researchers to know what to translate to the 90%. By the way, it’s not some sort of pyramid, this is just how news travels between people. It’s a fact.
“Actions speak louder than words” and “the best tech wins” are true either. When there are too many (good) bad words or the marketing for shitty tech is good - the opposite happens. Humans and thus markets are not rational.
2.7 Checks and balances in each of the groups
The 1%: can get too high on their own supply, get too elitist, and think highly of themselves. The more capital they get, the further away the reality check is for them. Getting too optimistically comfy in their thinking.
The 9%: are supposed to do research, but at the end of the day only know bits and pieces (like me). The issue is that they pull too much blanket onto themselves and waste founders’ time to explain things to them - otherwise, they can run rampant with wrong narratives and ideas. And these people tend to talk a lot, because, for many of them, opinions are their job. Can easily get phony.
The 90%: nothing bad! They take all the risks, they have the least access. Sure, their patience and survivability are the lowest, but that’s because they don’t have a golden cushion when devs decide to go rogue and take the cash.
Now let’s get to applying this playbook to Ethereum… hold on, maybe it’s too late?!
3. Ethereum: Vitalik vs DeFi vs EF.
What happened over the last few days is a lot of people getting pissed off at each other. There is nothing unusual with that per se; people are just confused and can’t find a way to express their confusion. They have worked for 3+ years since the last cycle, yet no new volumes or users came to buy their bags, so everyone is getting frustrated. That’s just a fact. I am not coming up with causes or solutions - that’s for another article. Just stating how things are.
Amidst all that, some tried to have proper discussions. For example:
Vitalik (1%) expressed his concerns about DeFi. Check this tweet, it’s properly written, and there are more in that thread. He is maybe too tunneled in his overly big vision, but he is being polite and provides context. He wants to think of bigger goals and inspire others to think beyond whatever we see today, to not get stopped by what we have, and to look into the future. That’s the point of having a vision. He doesn’t need to be right either, he is not an Ethereum owner.
Ethereum Foundation (1%) was silent on the topic of selling for a couple of years, and then Aya made a bit of an insensitive reply. Not because she said anything bad or wrong, it was just “not reading the room” because EF is so far away from everything that the common folk are dealing with. However, see this for details, EF did and does do a bunch of transparency.
DeFi founders (1-9%) get confused because, although they are strong and don’t care for external big daddy support, they wouldn’t mind some shoulder-patting and at least not bashing finance every step of the way that Vitalik almost jokingly did before. Perhaps he did it too much, and it finally got to people.
The communication wall is what is happening. Ethereum Foundation and big brain devs are looking too much into the future and thus sound like they don’t care about the problems of today. While they do, they have just gone further in their thinking. That’s a difficult thing for the other side to understand because they don’t have as much context into all of the brains and thought processes.
You end up with this:
3.2 Is there a structural issue with 1, 9, or 90 here?
As mentioned before, any criticism is conceptually valid, depending on the root cause. What’s the cause here: are devs being alienated, or are the 9s not sure what is going on, or is it simply the 90s crying about prices? That’s the question.
Let’s start with the 1%.
Are the devs working? Yes. Are they engaging in public discourse? Yes. Are different dev teams working on different things in parallel? Also yes. Are there events and hackathons to attract new devs? Also yes. Is there a structural approach to solving L2 fragmentation now that scalability has been partly addressed? Also yes. As a result, I don’t see any issue with 1%.
Let’s quickly check on the 90%.
Well, they know ETH is a big asset. They know markets can be red. What they are confused with, without a doubt, is how many of the 9s are confused themselves. Panic out of nowhere can lead to actual structural issues.
And now we are left with the 9%.
In my honest opinion: the 9s we see crying are ex-9s who turned sensationalist traders. Nothing wrong with that, but simply don’t see them as 9s anymore. They stopped digging beyond one-pagers and simply read the headlines. Confusing them with 9s can lead to you thinking there are structural problems. If you want to double-check this, ask the devs. If the devs confirm, then yes there might be issues.
No disrespect, but if you researched L2s and concluded that "fragmentation is killing ETH, it's over" while missing all the research on scalability - that's a skill issue.
3.3 Are the efforts being done or issues are being ignored?
It is clear and understandable why the 9s are confused. Ethereum grew, it has had an L2 roadmap for years which caused fragmentation on its path. It’s normal that when you go modular, you get issues with connecting the pieces back together. As long as the goal (scalability, bigger platform) works, it’s explainable.
Therefore, I understand if anyone feels bearish short-term, but making it seem like “Ethereum has died and is doing nothing for scalability” is an intellectual lie. Those 9s engaging in this are simply pushing their alternative bags, and are turning into the 90s. Keep an eye on the sensationalist twitteratis.
I am not protecting my bag because this write-up will not influence anyone. I am happy to see and accept structural issues as present, but beyond “an EF member got some advisory” and “EF sold some ETH which is less than 0.1% of total circulating supply” - I don’t see the arguments. You guys can do better.
But anyway, should the 9s be accommodated to, as the guidebook dictates?
I argue further that NO. It’s no longer needed and it’s no longer possible.
3.3 The Separation of State vs Church. Forget Leadership? Forget the 9s.
Ethereum is clearly at the network stage at this point. Asking to “align roadmaps” is a misunderstanding of the whole purpose of how things run. It doesn’t mean attempts at macro-alignment are not needed, but they now happen ad-hoc. If you see the first picture, consider the main orange-connected dots as the major Ethereum teams: clients, big funds with research arms, ecosystems of interconnected protocols, etc. As long as they somewhat sometimes align with each other, it’s fine. So ask yourself: if you don’t know what the orange ones are doing, perhaps you didn’t look deep enough. So it’s a skill issue, not an ecosystem issue. Get off your high horse.
All of these discussions, criticisms, etc. SHOULD happen. What is different this time is too many previously decent actors are turning into hardcore shit-storming and stirring stuff up. That is especially the case for GP of some funds (you know who I am talking about). Mostly the ones who are pushing their own L1 stinky bets. And it’s fine if they think other L1s are better, that they support them, etc. However, doing so at the expense of made-up fugazi arguments is intellectual suicide. Like this:
This is not the first time we have seen big ecosystems come to this. At this point, fragmentation, different misaligned interests, and so on - are genuinely at our doorstep. But instead of turning to communism and centralized roadmaps, perhaps the better path is to elevate this all into a state of non-fragility. Fancy words aside, none of this matters. DeFi, socials, whatever it is - Vitalik’s opinion or Ethereum Foundation’s or any cult leader's opinion does not matter.
So what to do?
Vitalik may be too elitist to want use cases that don’t exist yet or ever. People want a bit more tangibility, which DeFi brings.
Ethereum Foundation could be more transparent, sure.
The Ethereum narrative has gotten multi-faced, so it’s hard for the 9s to understand the one clear agenda, and thus they get confused.
… but the answer is: this doesn’t matter.
3.4 You can’t and you don’t need full alignment anymore.
How many cabals exist on Ethereum at this point? Client teams? Venture Funds? Pump groups? - The answer is: a ton. When was the last time you needed EF’s approval or Vitalik’s blessing to build anything (not core protocol related)? - Never.
EF can dissolve tomorrow, Vitalik can go on a rampage with yachts - that doesn’t matter. Even if transparency is an issue and even if Vitalik is wrong, who cares? Ethereum is or should already be at the stage when core initial groups don’t matter. Thus, attempts like the one below to turn it into some “Ethereum culture issue” shouldn’t be true. Culture is the open level playing field, not a central opinion. Bitcoin has gone through similar hoops before, so it’s an actual test of a thesis strength.
In my and my connections’ experience in crypto since 2017 none of the people ever got any meaningful support or funding from Vitalik. He shat on ICOs during the boom, he shat on DeFi in 2020 - it’s fine. He doesn’t need to be right. He had to be right about building the community and being a visionary man in 2015, 2017, and later… but at this point, some created coalitions against the EF. That’s good!
None of the DeFi founders required his blessing or EF’s support. In fact, it was built through the hate from their side in the first place. And yet DeFi survived and grew, so why ask for any blessing now? The one thing that is important to note is everything is fine as long as they don’t make some core protocol changes which turn DeFi in being less usable. For example, gas costs for certain DeFi-crucial operations. Basically chasing their big funky vision at the expense of DeFi usability and growth.
Thus, sensationalists can relax and not blow out small debates into big problems.
3.5 Other Points To Consider
Whatever Vitalik would say, people would get angry anyway. At some point responding to angry Twitter people gets negative unless they have valid criticism. But if they pick apart every word due to their spite: let them. However, reading the room would still be nice. Vitalik is decent at it, but not always.
Ethereum Foundation has a bunch of transparency in place but could be a bit more. There is no issue if they are not because barely anyone interacts with them directly. So it’s not of creating systemic issues where they don’t have to be (9s forcing this narrative as systemic). Perhaps look into other players in thee ecosystem which are growing to big size.
Alternate foundations spend dozens more and have presidents of foundations run VC funds (Solana) or even foundations almost buying meme coins (Avalanche). Again, it’s all fine and not fine at the same time, I am not trying to say “They did worse things so doing a bit of bad is okay”. No. I am just saying that those bag pumpers of other chains should maybe address their issues before barking.
By this point, I hope you understand the importance of correct messaging and communications. These basics go beyond the primitives and extend onto general community building and your positioning with fellow partners in the space.
As for Ethereum, I hope I made you believe there should be no hand-holding anymore. No more leadership. No more top-bottom centralized roadmaps. So let people fight, fleece each other, and bolster a free market…
And be careful who you listen to. The 9s often turn out to be the 90s. The exception is that the 90s don’t lie about their intentions, while the 9s love to sell snake oil.
Tweet less. GN <3